THE
FATE OF CONSUMER DISPUTES FOLLOWING THE REGULATION AND DIRECTIVE ON ODR AND ADR

The importance of effective and
low-cost dispute resolution between consumers and traders became crucial in the
European Union with the establishment of the single market. When looking at
consumer rights legislation in the EU, some fundamental questions need to be
answered. Firstly, where can a consumer’s rights be protected? Secondly, Should
it depend on the kind of goods or services consumed? Thirdly, should it depend
on the jurisdiction where those goods were bought or the rights were infringed?
The Regulation and Directive seek to answer these questions.

Background

On 29 November
2011, the EU Commission introduced two legislative proposals for a Directive on
ADR and a Regulation on ODR for consumer disputes. At that time, the 2011
Commission Work Program identified consumer ADR as one of the strategic
Commission proposals for that year. The legislation’s goal was to strengthen
consumer confidence in the Single Market. Thus, the implementation of the
Regulation and Directive aim to make the use of ADR methods in resolution of
consumer disputes across the EU possible.

In accordance
with the Directive a list of ADR entities that will have the jurisdiction to
handle such disputes will be provided. The Directive and Regulation were meant
to cover complaints filed by consumers against traders. However, they do not
cover disputes between businesses.

Thus, the
Directive on consumer ADR looks to fill the gaps in the coverage of ADR
entities all over the EU and to popularise the use of ADR entities by consumers
and businesses. In addition, it seeks to ensure that ADR institutions are of
high quality and in line with the Commission recommendations.